Lambda 's produced in central collisions of 40Ar+KC1 at 1.8-GeV/u incident energy were detected in a streamer chamber by their charged-particle decay. For central collisions with impact parameters b<2.4 fm the Lambda production cross section is 7.6±2.2 mb. A calculation in which Lambda production occurs in the early stage of the collision qualitatively reproduces the results but underestimates the transverse momenta. An average Lambda polarization of -0.10±0.05 is observed. PACS numbers: 25.70 Bc